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By now I gave it allot of time to recover. It didn't.
Removed all the zones and it goes down but to more or less half of what it was and stays there.

Can you please add a option/button to simply remove all homeless citizens?
Perhaps you have a problem not related to what this mod does and the mod cannot fix it for you. Perhaps you should first understand why your people are homeless and then try to fix the root cause.
 
I cant say in all cases but the one I can see it is because I demolish their house.
They stay in the sidewalk and don't go anywhere with "Going home". If I reset the citizens they move to another place and turn to "Idling" but I am not sure if the "Idling" happens in all cases.
 
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Please have a look at this post:

Post about the same subject I also made.